Colonial’s shut; what’s next?

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Alabama’s Colonial Bank collapsed Friday under the weight of the financial crisis and allegations of fraud – making it the biggest bank to fail this year.

US regulators shuttered the bank and sold its assets to BB&T, which got Colonial’s $20 billion deposits and an FDIC guarantee on $15 billion of assets.

One analyst questioned how much of those deposits will stick with BB&T after the takeover, though. Colonial was paying about 100 basis points more for funds than BB&T, said Richard Bove of Rochdale Securities, in a research note.

But in these times, the question probably is which bank is next.

The Financial Times reported regulators are seeking bids for Guaranty Financial by Monday.